Ethereum update: A clear signal regarding ETH issuance would support adoption, development, and network security.
The Ethereum Foundation have consistently and strongly signaled that Ethereum’s design will evolve to improve its utility. For example, it has been made clear that one goal of the Ethereum Foundation is to increase the rate of transactions that can occur on the Ethereum network. However, unlike the strong and clear signal given regarding improved scalability, the Ethereum Foundation has not strongly and clearly signaled that the ETH inflation rate will change from the current rate.
The value of ETH is based upon the perception of its current design and utility, and expectations of its future design and utility. The Ethereum network is secured by the value of ETH. A future Ethereum design with a higher maximum rate of transactions is interpreted by the markets that ETH will be more valuable over time, and thus, supports a higher price of ETH, and a more secure network. Conversely, the uncertainty regarding the future inflation rate of ETH does not support a higher price of ETH (as the inflation rate might be left unchanged, or increased) and this leads to a less secure network. Investors and users are understandably interested in acquiring cryptocurrencies that hold value or increase in value. Developers are interested in cryptocurrencies that have many users, are scalable, and are secure.
A strong and clear signal from the Ethereum Foundation regarding the future inflation rate of ETH would be beneficial for the development of Ethereum. Ethereum is fundamentally an economic network.
About Ethereum
Ethereum is a decentralized platform that runs smart contracts: applications that run exactly as programmed without any possibility of downtime, censorship, fraud or third-party interference.
Author: fangolo
Score: 16
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